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HomeMy WebLinkAbout2010-04-26 Finance Committee Minutes FINANCE COMMITTEE April 26, 2010 Minutes Councilors: Bronson, Nealley, Weston, Stone, Palmer, Hawes, Gratwick Staff: Cyr, Ring 1. Bids/Purchasing a. Ohio Street Resurfacing Improvements II – Engineering – Lane Construction - $486,319 Cyr said this project is for resurfacing improvements on Ohio Street from Griffin Road to Blue Hill West including replacement of sidewalks and curbing at existing locations. This is a BACTS project and as such 85% of the funding will come from the State of Maine, 15% will be the local match. Staff’s recommendation is to award bid to Lane Construction, the sole bidder, in the amount of $486,329. Responding to Nealley, Cyr said that the BACTS percentage should read 90% and 10% local. She also noted that the bid came in under estimate. A motion was made and seconded to approve staff’s recommendation to full Council. b. Architectural Services – Arena Project – Sink Combs and Dethlefs Cyr said a Council Workshop with the Special Committee on Arena Implementation was held in February. At that time, the Council accepted the recommendations from the Special Committee but directed staff to obtain a proposal from Sink Combs and Dethlefs, the architect on the market and feasibility study, and was also directed to issue a Request for Qualifications for construction manager. Both proposals were to be through the schematic design phase only. The construction process starts off with a concept and preliminary work. The next major step is schematic design which is basically 15-20% of the total project. Design development is the next 20%, construction documents for an architect is 40% and then building and construction administration. The Council was uncomfortable in that it didn’t have enough information to make a decision on what the final arena project should or should not look like. One key piece of information was how much it would cost in this particular environment designed down to what the City would like to see. The Dethlefs proposal has been received and is what will be discussed this evening. The qualifications for the pre-construction manager came in last Friday. Five responses were received from very high quality firms. Staff will review proposals and complete interviews. Cyr thinks the recommendation will come to Council at its second meeting in May. Sink Combs and Dethlefs’ proposed fee is 6½% of estimated construction costs and is further delineated by each of those benchmarks in the process as previously discussed. The total fee for architectural services through schematic design is $573,105 plus reimbursable expenses. The proposed fee is competitive for architectural services. In speaking with Don Dethlefs, he knows that the City plans to have a pre-construction manager on board the end of May. Dethlefs needs to take the drawings from their conceptual level right now and to further define them before the construction manager can actually do work. Dethlefs needs to meet with all stakeholders to define the parameters in which he needs to operate. Based on Council direction, Cyr recommended that the Council consider authorizing execution of a contract with Sink Combs and Dethlefs for an amount not to exceed $573,105 plus expenses. Bronson asked about the 6½% of estimated construction project. Cyr said that it is 6½% for the entire project. The schematic design is based upon 15% of the estimated construction cost. She noted that Dethlefs is working on the schematic design summary, which she feels all stakeholders need to discuss, and is $58M. A total fee for Dethlefs would be just over $3.8M. Cyr noted that the proposal at this point is to do just through the schematic design, which would be 15% of that $3.8M. Bronson recalled that 25% of the project would be soft costs and design. Cyr confirmed. Bronson asked about the soft costs and if it included other engineering expertise that is not included in architectural. Cyr said it would, as an example, include work with a local architectural/engineering firm(s) as a liaison and to assist during each phase of the project, that local firm would have the major portion of the work during construction observation phase, use of a local civil engineer, use of a local landscape architect, food service designers, acoustical engineers, structural engineers, mechanical, electrical, planning and telephone engineers. It does not include a geotechnical and soil firm, which the City would hire locally. Bronson stated that the 6½% would be the art of the design and the remainder in the 25% is the more technical/engineering type. Cyr clarified that the engineering subs are part of the architectural services, part of the 6½%. Bronson then asked what the other 25% includes. Cyr said the other soft costs are furniture, fixtures, outfitting of the facility and potentially any other subs required; i.e. a private management firm. Hawes said there are citizens who are a bit concerned of the overall cost. At some point, she hopes there will be something in print (local newspaper) for citizens to understand that this whole project is in phases and the City has talked about where the project would be stopped after a specific phase. She spoke of a private management firm, which most of the Arena Committee felt was a vital part of the project. Nealley said that it might be that the construction manager is capable of performing some of the services needed bringing down the overall cost or might recommend other firms. Nealley made a motion that a construction manager be on board first and then review the Dethlefs proposal. Weston seconded it to move forward for further discussion. Weston felt that more discussion and conversation is necessary. He mentioned having the historical data available on the City’s website. He said he would be in favor of starting with the convention center first and then moving toward the arena side. He feels there are more prudent ways of going about the project. Hawes said what the Arena Committee recommended is not a set in stone version of what will or will not be built. It was a starting point for discussion. She has spoken with Cyr about having a Council Workshop to further discuss the issues being brought up this evening. Dethlefs is on hold and there is still work they need to do in order to present to the City and the construction manager to be hired. She said that Dethlefs and the construction manager need to be dealt with as a package. Without these two steps, the City won’t be able to further move ahead. She suggested a full Council Workshop after these two pieces are in place. She agreed with placing the information on the City’s website. Gratwick likes the concept of a new arena but is concerned about the dollars and budget deliberations. Responding to Gratwick, Cyr said that if history is any indication of the future, she expects construction costs to escalate in the future. She noted that the arena information will be on the City’s website. The employee charged with that task is delayed in New Hampshire today; otherwise, it would have already been done. Responding to some previous comments, Cyr said that some seem to feel that by executing the Dethlefs’ contract that the City is off and running with the project as presented in the report, which is not the case. In a construction project of this size, the first chance to break and re-evaluate it is at the end of the schematic design phase, and that is all that is recommended at this stage. The conversation of money to be spent, and the order of the project, etc. needs to take place before the schematic design process begins. In order to clearly define the parameters under which this individual needs to move forward with the schematic design, she suggested this decision needs to be made within the next couple of weeks. She stressed that the Council is not locked into anything but needs to start somewhere. Regarding the construction manager, Cyr stated that these are not services that construction managers carry. They will potentially have some layout input but they do not have these types of resources on staff; i.e. structural engineers, mechanic engineers. They have certain subs they work with but do not carry them. The architect estimated it would take about four months, based upon the input from stakeholders, to get to the point of a schematic design level. The pre-construction manager’s role is to find better ways to build the structure and to accurately cost it out. They will be asked to establish a guaranteed maximum price (gmp). Nealley said he didn’t think a majority of the Council had made a decision to move forward with the full project and bond $40-45M nor had it made a determination to stop any of the activities that it agreed to engage in. He took issue with the fact that construction managers do not regularly have that type of staff on hand. Sometimes they do and sometimes they contract out portions of it. He would like to see a determination made on a construction manager before making a determination to engage in the Dethlefs’ contract. Nealley asked for the debt cost on $40M financed over 20 years. Cyr said the current borrowing rate is at 2½ to 3%. Nealley spoke about EMDC’s work in obtaining grant money, private sector opportunities, public relations, etc. He would like to wait for a decision on a construction manager before authorizing the Dethlefs’ contract. Responding to Weston, Nealley restated his motion which was to delay action on this item until the Council has selected a construction manager. Cyr said the construction th manager piece should come before the Council on May 24. She reiterated that 5 responses were received to the Request for Qualifications. Cyr will attempt to bring th staff’s recommendation to the May 17 Finance Committee. Responding to Weston, Cyr said that, if the Committee approves the award of contract to Dethlefs’, it would be considered under suspension of the rules at tonight’s Council meeting. She pointed out that typically an architect is on board first. Weston asked about the possibility of scheduling a Workshop Session due to budget workshops and time constraints. In response to Stone, Cyr said reimbursable expenses are for printing, telephone, and travel. All other is included in the 6½%. Stone would like to see a construction manager in place first. Palmer said he is very committed to Dethlefs and a new facility. He would like to see this advanced tonight for further discussion. He is not confident that Phase II has reached the right plan at the moment. Bronson said it seems that the Council is split on the project and that a Workshop is needed to bring the Council into the same focus. He feels a construction manager can help bring the Council to that point. He would like to see a construction manager on board prior to hiring an architect. Nealley made a recommendation to delay staff’s recommendation for the Dethlefs’ contract award until a construction manager has been decided upon. He is confident that the construction manager will come with such credentials so as to help lower the cost. Weston seconded Nealley’s recommendation. It will go forward to this evening’s Council meeting. Bronson asked for those in favor of the recommendation as outlined by Nealley’s motion. The three committee members voted in favor and the motion passed by a 3-0 vote. Adjournment at 5:45 pm